Oregon Supreme Court hears oral argument on Hotchalk’s mandamus petition
Attorneys for Hotchalk, Inc. and the Lutheran Church–Missouri Synod discussed U.S. Supreme Court jurisprudence and the church’s right to secrecy in an hour-long hearing before the Oregon Supreme Court on June 22. Plaintiff’s attorney Jim McDermott asked the court to vacate a lower court’s order ruling that Synod documents are protected from discovery under the First Amendment. “No court in the United States of America has ever applied the religious clauses of the First Amendment in the way this trial court did,” McDermott said, “to block discovery into the defendants’ alleged misconduct.”
Attorney Tim Volpert, representing the Lutheran Church–Missouri Synod, argued that the trial court exercised proper discretion balancing First Amendment organizational-autonomy rights for religious organizations with the plaintiff’s right to discovery in civil litigation. “Just like the trial court does when it decides something is unduly oppressive, unduly burdensome, the trial court balances interests,” he said.
Hotchalk alleges the Synod and multiple Synod-related entities engaged in fraud, fraudulent transfer, and intentional interference with Hotchalk’s contract with Concordia University Portland to keep valuable assets “in the Synod family” – such as the campus of Concordia Portland, which later sold for $60 million – leaving other creditors, like Hotchalk, with nothing. Hotchalk alleges the Synod is improperly witholding about 800 documents that are relevant to their suit.
The justices considered whether First Amendment protections shield religious organizations from a “chilling effect” that disclosure can have on free association and free exercise of religion. “What’s wrong with the argument that there is a well-established constitutional right of autonomy for religious organizations and that when documents related to those autonomy-type decisions are reviewed there can be a chilling effect on that protected right; and that the chilling effect, just like in Perry,1 is something that the trial court can consider as part of balancing whether this [discovery] request is oppressive,” asked chief justice Meagan Flynn.
She continued: “Discovery is governed by Oregon rules that specifically say the court can enter a protective order, including limiting the scope of discovery, based on certain considerations; and what tells us that concerns about a chilling effect on a constitutionally protected right are not legitimately part of that consideration?”
“I think nothing expressly tells you that, and I have to concede that, obviously,” said McDermott, the Hotchalk attorney, “but the church autonomy doctrine has not been extended to protect discovery; that’s the main point here.”
The state Supreme Court will continue its review of the mandamus petition, and a decision is not expected until sometime next year.
CUS Facts 